Institutional - Wind Energy: Renewable Energy and the Environment - page 233

11.6.1.2 GreenPower
Green power is a voluntary consumer decision to purchase electricity supplied from renewable
energy sources or to contribute funds for the utility to invest in renewable energy development.
Green power is an option in some states' policy, and also has been driven by responses of utilities
to customer surveys and town meetings. Green power is available to retail or wholesale customers
in twenty-two states [37].
In the early 1990s, a small number of U.S. utilities began offering green power options to their
customers. The consumer had to pay a premium, which was around $3/month for a 100 kWh block.
This represented a powerful market support mechanism for renewable energy development, which
was mainly wind energy. More than half of all U.S. electricity customers have an option to purchase
green power from more than 750 utilities, or about 25% of utilities nationally [38]. It is interesting
that some utilities have lowered the rate premium on green power as traditional fossil fuel costs
have increased. As green power becomes cheaper than regular power, will those consumers who
purchased green power pay below the regular rate? NREL ranks the utility green power programs
annually [39].
11.6.1. 3 NetMetering
If the renewable energy system produces more energy than is needed on site, the utility meter runs
backward, and if the load on site is greater, then the meter runs forward. Then the bill is determined
at the end of the time period, which is generally 1 month. If the renewable energy system produced
more energy over the billing period than was used on site, the utility company pays the avoided
cost. Most of the states have net metering, which ranges from 10 to 1,000 kW, with most in the 10
to 100 kW range [40].
In general, net metering did not increase the sale of wind turbines because the small wind tur-
bines, 10-50 kW, are not cost-competitive with retail electricity. Larger-sized wind turbines can
be cost-competitive for users with large loads, where all the electricity is used on site. Because the
value set for the avoided cost is generally only equal to the fuel adjustment cost, you want to use
that energy on site, as that displaces energy at the retail rate. Also, if the time period could be set
longer than 1 month, net metering would be more useful to the producer. This is especially true for
irrigation, where the large demand is in the summer, and that is the period of low winds for most of
the United States.
Of course, utility companies do not like net metering because it increases the billing problem, and
the utilities say that one group of customers is subsidizing another group of customers. With electric
restructuring, utilities are worried that large customers will find cheaper electricity, and then rates will
rise for residential customers. Does that mean that many residential customers are subsidized today?
11.6.2 O THER C OUNTRIES
Several European countries started wind energy programs in the 1980s, with most emphasizing
megawatt wind turbines; however, these had little success. The manufacturers in Denmark pro-
duced small to larger units in steps and acquired around 50% of the early U.S. market, and 66% of
Europe's installed capacity in 1991. Today, European manufacturers have captured the major share
of the world market for wind farms.
There were different policy options for renewable energy in the European Union (EU) [41, 42].
The effectiveness and efficiency of current and future support for renewable energy for producing
electricity were analyzed [43]. Free trade in renewables in the EU market is complicated by the fact
that renewables are supported by mandates or fixed prices at different levels by country and even
state. This support could be regarded as a substitute for a pollution tax on fossil fuels.
Promotion of wind energy in Europe was based on two models: (1) price support for kilowatt-hour
production and (2) quota or capacity based ( Table 11.1 ). Quota is similar to a Renewable Portfolio
Standard. In general, the minimum base price has resulted in the most installations [44].